Britannia’s profits plunge as recession takes its toll

The mid-market operator remains confident that the business is well placed to meet the challenges

Less than a month after being named as ‘the worst hotel chain in the UK’ by consumer watchdog Which?, Britannia hotels has reported a 69 per cent fall in pre-tax profits due to ‘additional demands on the business’.

The 44-strong, Hale-based hotel chain did report a 25 per cent rise in turnover, to almost £70m for the year to 31 March 2013, but pre-tax profits slumped to £3.5m, from £11.4m 12 months earlier.

In its latest financial report, filed at Companies House, the mid-market hotel operator said: “In order to sustain and enhance our position in the market we have endeavoured to improve the standard of our product both in terms of facilities and levels of service.

“The group has made strategic acquisitions of hotels during the year and has also added two additional properties since the year end.

"The directors recognised that economic conditions in the short term are likely to put strains upon the business and have carefully considered the availability of working capital and likely levels of trading over the next 12 months.

"We are confident that the business is well placed in order to meet the challenges."

Britannia Hotels was founded in 1976 by Alex Langsam. Now, the firm owns 44 properties across the UK, employing just under 2,000 staff.

Customer service​

In a recent survey by Which?​​ – where members were asked to rate 36 UK hotel chains on cleanliness, customer service, bed comfort and value for money – Britannia came out worst, with an overall customer service score of 36 per cent.

Guests described the hotel as ‘shabby’ and ‘run-down’, with many shocked at the availability of bedrooms without windows. “It was £10 a night extra for a window in the room,” explained one disgruntled Which? member.

Operating costs for the year have increased by 90 per cent due to a significant increase in expenditure of repairs and refurbishment. Britannia sais this was part of its plans to ‘bring recent acquisitions to the required, high Britannia standard’.

The group also owns the Pontins holiday camp business, but this is not included in the Britannia results as it is registered in Jersey.